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April 20, 2010

Introducing Peer Influence Analysis: 500 billion peer impressions per year

When we published Groundswell, we included a statistical tool called the Social Technographics Profile. This has been one of the most popular elements of the book, since it puts a survey-based framework on people's intuition about social technologies.

Empowered, much more than Groundswell, focuses on the power of individuals and word of mouth. The question is, can you quantify that? Yes, you can. And since Empowered won't be out for months, we're releasing the word-of-mouth analysis tool from it now. It's called Peer Influence Analysis.

Here's how it works. Start by counting every instance in which a person influences another person online about a product or service. (We model this from Forrester’s 10,000 person survey, which asks how frequently they post, in what places, how many followers they have, and what products and services they post about.)

This influence comes in two types.

First, there is influence from people posting within social networks: Facebook, Twitter, MySpace and so on. We call these instances influence impressions. Based on our surveys, we estimate people in the US create 256 billion influence impression on each other in social networks every year. (Has anyone ever measured this number before?) Of these influence impressions, 62% come from Facebook.

Second, there is influence created by posts: blog posts, blog comments, discussion forum posts, and ratings and reviews. We call these influence posts. We estimate that people in the US create 1.64 billion influence posts every year. If around 150 people view each of these posts (a conservative estimate, based on our research), that’s another 250 billion-plus impressions. Blog posts and blog comments account for about 40% of these posts.

Add the impressions from both social networks and posts together and you get more than 500 billion impressions about products and services a year. Impressions made by people on their peers.

Once you start analyzing this huge pool of influence, you can draw some very interesting conclusions. Here are a few.

  • People's influence on each other rivals online advertising. For comparison, for a 12-month period ending September 30 last year, Nielsen Online estimates advertisers created 1.974 trillion online advertising impressions, compared to the 500 billion impressions people make on each other about products and services. So people's online impressions on each other about products and services are about one fourth of the online advertising impression. And peer impressions are more credible than advertising, since they come from friends. Take those number into your next budget meeting!

  • A minority of people generate 80% of the impressions. Take a look at the graphic below. 6.2% of the online adults generate 80% of the influence impressions. 13.4% of the online adults generate 80% of the influence posts. We call two groups Mass Connectors and Mass Mavens (if you've read "The Tipping Point" you know where we got the names.). If you're a marketer, you probably want to know who these people are (demographics, where they share, that kind of thing). We've got a lot more detail about just that in the report that Augie Ray and I just released about them.Mass influencers
  • You can do peer influencer analysis for any type of product or service. For example, Augie and I analyzed consumer electronics mass influencers. They're far more concentrated, somewhat more affluent, and quite a bit more male than the general mass influencers. You can build a word of mouth strategy right off of this data, and we show how to do that in the report.

It’s time to start analyzing peer influence with the same discipline we apply to media. And it’s time word of mouth got a budget that reflects the amount of influence people have, and who has it.

We are just at the beginning of understanding the best uses for this tool. If you're interested in following up, you could . . .

Read the report about Peer Influence Analysis (available free to Forrester clients).

Contact our data and consulting team to analyze the data for your own products and services. (We've asked about 39 different categories or products.)

Read how these mass influencers fit in with other categories of people in Augie Ray's "Influence Pyramid".

Come hear Augie and me talk about this in public for the first time at the Forrester Marketing Forum.

I can't wait to read your reaction.


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karen orton

Great stuff.
One question - how does this influence model change when are are talking about B2B customers/peers? Is it skewed to other kinds of sites or places - forums/blogs on a company site or lesser known third party sites related to the subject area or even Linkedin?
I certainly get the huge influence of Facebook on consumers but wondering how this is different when you look at people and peers in B2B.
Thanks for great information.
Can't wait for the book.

Duncan Brown

Impressions don't equal influence. Influence implies that people act on the impressions, they have some impact on a person's decisions or behavior.
Your analysis measures outbound 'stuff' but doesn't (can't?) measure whether anyone actually was influenced. It therefore doesn't actually measure what it claims.


azeem azhar

hey josh
hope you remember me from my economist/bbc days

this is awesome thinking, and some great analysis.

agree--this peer marketing is hugely underexploited.
wd you check out what we are up to? www.peerindex.net

Josh Bernoff

@duncan It's tough to measure influence in a quantitative way, but we can measure impressions people make on each other. To help the analysis, we also measure what people check before making a decision.

Jo Stratmann, FreshNetworks

Great post Josh.
When looking at word-of-mouth and influencers I think its important to look at:
1. What’s being said

2. The identity of the person who sends the message

3. The environment where the message is circulated.

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